The European Union is making moves to establish a legal framework for the cryptocurrency industry with the introduction of the Markets in Crypto Assets (MiCA) proposal.
The new regulations aim to regulate the industry and restore trust following high-profile collapses. The proposal was discussed at a European Parliament session in Strasbourg, where many lawmakers praised the establishment of a legal framework as a significant advancement for the bloc.
The absence of regulation over the past decade has led to substantial losses for inexperienced investors and provided a sanctuary for criminals, according to Spanish MEP Ernest Urtasun. However, some parliamentarians expressed concerns, with German MEP Gunnar Beck accusing the E.U. of criminalizing decentralized finance and its users by mandating more transactions to be reported to relevant authorities.
If approved by parliament, MiCA will receive final endorsement from the European Council in May before being officially published. Stablecoin regulations will take effect in July next year, while other requirements will not be enforced until January 2025, allowing providers more time to adapt. The hope is that the new regulations will position the E.U. at the forefront of the token economy and help regain trust damaged by high-profile cases.